Did you pay for help when looking to buy and Inn?

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MaryE's picture
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03/07/2020

I have contacted a few popular realtors in the B and B world and was told (via the fine print) that I would pay for some of the work they did as the buyer.  Also in the fine print, if the seller doesn't pay the commission on what I end up buying, I have to pay it.   Is this normal?  Anyone ever had to pay for these services as the buyer?   Any realtors I should stay away from?  Please send me a private message if you like, I understand not wanting to mention names on a public forum. Maybe there is another way to buy without a realtor?  All ideas and suggestions are welcome.  

__________________

Mary
Aspiring Inn Owner

 

info@featherhillinn.com's picture
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03/20/2019

Hi Mary, I also found some of the B&B brokers to be "overly assertive" when I was thinking to sell my property so I got my real estate broker's license in CT and am selling and marketing myself.  Gillumhouse gave good advice that you can buy a house and convert it to a B&B and got lucky that there were no zoning regulations in her community.  However, most communities have zoning regulations and the property would need to either be zoned to allow for a business and B&B use or be "grandfathered" in. To change zoning regulations are expensive and almost impossible.  And yes, contact listing agents directly!  If you are interested in Connecticut as a location - between Boston and New York - see: https://ctproperty.yolasite.com/.  Christine

gillumhouse's picture
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Also be aware of State laws. When renovating a property what you do (how extensive) makes a difference. We looked at some houses that the best idea would be go down to studs and rebuild - THAT would trigger "new" construction and would mandate a sprinkler system in my State. AND just because something may be currently a B & B - CHECK OUT GRANDFATHERING as it sometimes does NOT apply to the new owners.

JimBoone's picture
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Thoughts 

Choose an area where you would enjoy living, weather, distance to family, activities you enjoy, step one is you need to be happy. We chose our vacation area, liked the area, knew it was an area that attracted visitors and we had visited enough to know our way around the area.

Ask yourself why you want to be in this business. We chose it as we enjoy hosting our visitors, also the gardens and working from home. In our case, home, is an 8 room motel, we miss the fun or problems of feeding those folks, have a bit more privacy, yet can still be as involved with our guests.

Whatever style of business you chose, open your mind to different style buildings, an old commercial building could become an inn as well as a former home.

Maybe I’m just odd, but figure the business reflects our personality. I figure I am going to be more successful just doing a good job of being me and attracting guests of a similar mind, than I would trying to be something I’m not good at in an attempt to please others.

For whatever it is worth we are getting close to 30 years at this and still love the business, choose to be happy, it makes for a good life.

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Jim & Maxine

 

Morticia's picture
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05/22/2008

No, as the buyer you should not be paying someone to do their job. The seller pays the commission and it’s up to the brokers to work out their own payment deals. 

Now, knowing that, you will understand why some brokers refuse to show properties they don’t list themselves. So, you may need to just call the listing agent. If it’s a legitimate broker they will tell you you need your own rep and will generally hand you off to someone in their office. Again, they will sort out how they get paid.

 It’s possible if you are hiring someone to work for you, someone who only shows properties and doesn’t  have any listings, they expect to be paid for the time they take with you.

 Which is why I’d call the listing office and deal directly with the listing agent.

 We were looking 16 years ago and we worked with multiple brokers, none of them asked us to pay them. We looked at about 15 places in 5 different states, so we worked with a lot of different offices.

__________________

What a long, strange trip it’s been.

 

MaryE's picture
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03/07/2020

One of the brokers I talked to got very upset because I called the number on another Inn I found on line, and he got wind of it.  I was just calling whoever was listed in the ad and he called to lecture me for 15 minutes.  I never had any agreement with him at all to use him as my exclusive buying broker.  He then sent me an agreement to be the exclusive buying agent and get paid a certain amount if the seller and seller agent didn't pay his percentage.  I didn't sign it, I just said "I'm not sure an Inn is for me yet, I'm just gathering info right now".  I may still work with him because he has a lot of listings but won't be signing a buyers agent contract.  

Thank God it sounds like this isn't normal and so I'm going to just call the listing agent from now on.

Are there workshops anyone here recommends?  

 

Thank you so much for responding!  (I did edit this about 4 times because I don't want anyone to recognize the realtor, it's a small industry and I don't want to cause trouble, I just want to possibly buy an Inn)

 

TheBeachHouse's picture
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06/24/2013

MaryE wrote:

One of the brokers I talked to got very upset because I called the number on another Inn I found on line, and he got wind of it.  I was just calling whoever was listed in the ad and he called to lecture me for 15 minutes.  I never had any agreement with him at all to use him as my exclusive buying broker.  He then sent me an agreement to be the exclusive buying agent and get paid a certain amount if the seller and seller agent didn't pay his percentage.  I didn't sign it, I just said "I'm not sure an Inn is for me yet, I'm just gathering info right now".  I may still work with him because he has a lot of listings but won't be signing a buyers agent contract.  

Thank God it sounds like this isn't normal and so I'm going to just call the listing agent from now on.

Are there workshops anyone here recommends?  

 

Thank you so much for responding!  (I did edit this about 4 times because I don't want anyone to recognize the realtor, it's a small industry and I don't want to cause trouble, I just want to possibly buy an Inn)

 

you surely don’t need to work with a broker who lectures you!   

Where are you looking?    I know a turnkey place with an excellent reputation for sale north of Boston.    

__________________

TBH

 

Morticia's picture
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05/22/2008

Depending on where you are located, there may be state sponsored classes or workshops. There are conventions you can attend sponsored by some brokers or by the national hospitality association (sorry, drawing a blank on the name).

 If you know where you want to live, go to a workshop specific to that state so you get the best practices for that area. If you are still looking, go to regional or national workshops or conventions.

 I’m not sure I would stick with someone who lectured me on etiquette. That broker may have lots of listings, but anyone can show them to you. Just don’t look at the same property with different brokers. 

gillumhouse's picture
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I just bought a house and turned it into a B & B. I wanted it to be small enough to be DIY and that has worked for me. As the buyer of the house, I did not pay the realtor.

MaryE's picture
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03/07/2020

I thought of that too but don't you have to be located in a commercial designated house?  Can you turn a residential home into a B and B or Inn?

 

gillumhouse's picture
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05/22/2008

Step #1 - go to City Hall or County whichever has jourisdiction before spending ONE PENNY and visit ZONING, BUILDING CODES,  and TAX OFFICE. Ask what are the requirements for the location you are interested in. GET IT IN WRITING - do not take anyone's word for anything as the next person could interpret differently. #2 - decide how many rooms you will need to do what YOU want - sole support no less than 5 or 6 rooms and look to where you can add the private bathrooms. I expected mine to cover the expenses of the house - utilities, insurance, taxes, marketing and it mostly has since my "needs" are small and I live in a State that is not consumed with taxation - YET! I have 3 rooms in a small city pop. 2500.

When I opened, my City had no zoning & planning commission - we do now and I am on it. When we wrote the Code, I ensured any section could have a B & B in it BUT to be good neighbors (we have some streets too narrow for the fire engine to get through the parked cars so if there is a fire, there will be a lot of wrecked cars) they are required to have at leat 1 off-street parking place per guestroom.

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